What Do You Need to Know About Medicare’s Star Rating System

Medicare's Rating System

We’re all used to seeing star ratings used to give us an idea of the quality of something, whether that might be a blockbuster movie, a hotel or a local business.

This somewhat universal rating system is also used in the US healthcare industry to help patients pick the right insurance policy and provider, while additionally encouraging organizations in this sector to strive for improved performance year on year.

Let’s look at some handy talking points relating to the Medicare star rating system so that you can interpret it accurately every time, and make the right decision when selecting a policy.

Each star rating represents a specific level of quality

As you’d expect, Medicare insurers as well as the plans they offer are rated out of a possible maximum of 5 stars.

A one star rating equates to poor performance, two stars denotes below average performance, three stars means average performance, four stars signifies above average performance, and five stars highlights excellent performance.

Various factors are taken into account to calculate these ratings, such as the outcomes of treatment received by the patients currently using them, the quality of the experience that patients have reported, the level of access that is available to those in need, and the additional processes which insurers offer as part of each policy.

In short, there are lots of aspects considered and the calculation of star ratings is complicated by design, but the purpose of using this system is to make interpreting it simple for anyone. The more stars attained, the better the insurer and policy.

Ratings are reviewed annually

Medicare star ratings are not just achieved once and then used indefinitely, but rather need to be reviewed and re-earned each year.

This is yet more good news for patients, since it means that you can trust that a rating is an honest reflection of performance right now, and that these companies cannot just rest on their laurels.

Switching to a better plan is always possible

Even if you already have insurance under a Medicare policy, you don’t have to stick with this if you think that you would be better off moving to a higher rated plan.

The only caveat to keep in mind is that changing to a five star plan is possible once per calendar year, no more. Local availability is also a requirement, and it’s worth noting that since scores are reviewed annually, a five star plan could drop down to four or vice versa.

A lack of a star rating isn’t always a red flag

Lastly, you might think that if a particular policy or provider does not have a Medicare star rating, it is perhaps deemed so poor as to be unworthy of any rank.

In reality, this usually just means that the product or company has not been around long enough for a thorough assessment of its performance to have been made.

As you can see, star ratings are a good starting point for picking a Medicare plan, but as with other aspects of the healthcare industry, more research is needed to find the right one for you.

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